British International Investment, the UK’s development finance institution and impact investor, has fulfilled its commitment to attract new international investors into India’s electric vehicle industry.
In July 2022, Mahindra and Mahindra and BII announced a partnership to accelerate the availability and adoption of Electric Vehicles (EVs) in India and other markets.
This partnership consisted of an anchor investment into a new EV company, launched by M&M, with BII committing up to INR 1,925 crore to the venture; of which INR 1,200 crore was invested by September 2023.
The partnership also comprised a commitment to work jointly to bring other like-minded investors into EV financing in future.
The next investor to join the partnership was Temasek in 2023.
And today, based on joint assessment with M&M on the funding requirement, BII has completed its 2022 commitment by making a further INR 650 crore investment into Mahindra Electric Automobile Limited (MEAL), as a part of its final tranche.
This investment will be made through its managed vehicle and existing shareholding entity, BII India EV LP, which in turn has been financed by a syndicate of marquee climate-focused investors led by BII. The syndicate includes the Asian Infrastructure Investment Bank, a multilateral development institution, OP Finnfund Global Impact Fund I, the first Finnish global emerging markets impact fund and Finnfund, Finland’s development finance institution and impact investor.
The investment does not change the shareholders of MEAL, which remain Mahindra & Mahindra, Temasek, BII and BII India EV LLP.
Samir Abhyankar, Managing Director and Head of Financial Services at BII, said:
“An important objective for this investment was to support a clean, green and sustainable economic future for India by backing superior business models in nascent industries. A critical part of that task is to crowd in other investors. Today’s announcement is a fulfilment of that mandate by bringing in three like-minded impact investors and a significant vote of confidence in Mahindra’s EV business and the wider EV sector in India.”
“We are thrilled to be part of this transaction and are confident that our investment will significantly enhance the availability of electric vehicles in India,” said Tuomas Virtala, Head of OP Asset Management.
“This initiative is an important step towards making EVs more accessible in India, and plays a critical role in reducing pollution, particularly in major cities,” said Helena Teppana, Associate Director at Finnfund. “Finnfund’s investments in electric mobility have been strongly driven by the health benefits, which are especially crucial in cities with congested traffic.”
Najeeb Haider, Director General, Project and Corporate Finance Clients, Global at AIIB, said:
“This investment is pivotal in supporting India’s ambitious energy transition goals by leveraging electrification to create sustainable EV sector infrastructure in India to assist the country in achieving its climate goals. Our commitment to Mahindra and Mahindra’s EV business through the investment in BII Indian EV LLP underscores AIIB’s dedication to financing sustainable infrastructure and fostering low-carbon solutions in India.”
